Blog Post

What is Your Approach for Investing in Real Estate in Long Beach?

Dustin Edwards • April 2, 2021

Find the Approach that Matches Your Personality

Real Estate Investment
When you first start investing in real estate in Long Beach it can feel overwhelming. There are countless books, nearly endless videos and plenty of “gurus” who are happy to coach you to success with your real estate investing goals. While you certainly can pick up tips from nearly anywhere we have found that investing in real estate most commonly falls into a few categories. Understanding which category you fall into as an investor can help you to get the most from your investments...and as you go on in your investing path you certainly can have investments in each category.

Buy and Hold
Buying and holding an investment is as straightforward as it seems. In this form of real estate investing the investor usually identifies a property that is nearly turn-key (i.e. doesn’t need repairs/updates) and then leases it to a tenant. Of course they could involve a local property management company for the lease up portion, but the key here is that the investor purchases the property at an optimum price, does not need to capitalize the property with additional investment dollars, and then leases it up with the goal of holding it for an extended period (usually 10 years or longer).

Buy, Update, and Hold
In this category of real estate investment the investor identifies a property (whether that be a single family home, condo, duplex, etc.) that isn’t up to today’s tenants goals. This could mean that the property hasn’t been updated since its original charm of the 1940’s or 1970’s but is structurally sound none the less. While “charm” can be nice if you are a homeowner tenants generally want to know they are stepping into a turnkey property when they are going to be paying top dollar for the rental.

An investor that has this approach will often look for a property where they can bring a fresh update to key areas such as the kitchen and bathroom(s) so as to demonstrate to a tenant that they will enjoy a top notch property. Preferably the updates are more on the cosmetic side (i.e. including such items as cabinets, counter tops, etc.) but not with the goal of structural items (i.e. roofing, foundation, etc.) as the structural items aren’t contributors to increasing the rental value.

Buy, Improve, and Hold
An investor with the approach of improving the property is looking to add tangible value to the property by adding square footage. The investor who adds square footage understands that in Southern California you could be paying up to $350 a square foot to develop the property further but the value of that square footage can be $500-$700+ in the Long Beach market.  

Adding square footage can come in the form of adding a second bathroom to make a common 3 bedroom, 1 bathroom home a highly desirable 3 bedrooms and 2 bathrooms or it could mean something as dramatic as adding an ADU to a property. When you look to improve a property, take time to do careful analysis, such that you don’t over build for the given neighborhood.

One area you didn’t see us address is that of ground-up new construction. While this is certainly a possibility, we have found that where Long Beach is currently in it’s growth cycle generally the ground up new construction projects are larger multifamily developments. 

If you’d like guidance on any category of investment we shared here we invite you to call us today at (562) 888-0247 as we’d be happy to help. When you want a quick check to see how much your property could fetch in rent we invite you to fill out our Free Rental Analysis where we perform a comprehensive comparison to share your rental stacks up to the competition.

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By Dustin Edwards November 18, 2024
Be aware of these 3 common issues when the rainy season arrives at your rental property.
Cold weather can come fast and strong so it's best to ensure your property is ready for this climate
By Dustin Edwards November 12, 2024
It's important to prepare your rental properties for the colder weather. Although we don’t need to prepare for snow and freezing temperatures, we do need to prepare for the cold and rain. By ensuring your rental is cozy inside and prepared for the fall season , you can not only reduce energy costs for your tenant but also maintain your rental property value. Today, we’ll go over three signs your property is ready for this upcoming cold weather.  Sign #1 Proper Weatherproofing During the colder seasons, it's much easier for a tenant to notice any cold spots in your rental. Well-insulated doors and windows can not only help maintain the warm temperature but also prevent it from lowering. It can also prevent cold spots and drafts, which can help with tenant satisfaction . Doors and windows should be properly sealed and insulated to prevent drafts and maintain proper temperatures. A visual inspection of the weatherstripping around doors and windows to ensure they’re intact is a great place to start. If damaged, consider replacing them, as trying to seal gaps can be tricky and rarely lasts. Other seals should also be checked, as well as any areas that need to be caulked in order to keep cold air out. Insulation during the summer helps keep the cool air in, and during the winter, insulation in the halls and attics helps retain desired heat. Hot air rises, and if there isn't adequate insulation in the ceiling, heat will continually be lost. Luckily, adding insulation to an attic is not uncommon and typically only requires a day or two for installation. Sign #2 Energy Efficiency Measures During the winter, it's not just the cold you need to keep in mind. As days are much shorter, there is less sunlight to keep the rental warm and more hours of darkness. For this reason, it's a good idea to keep energy efficiency in mind when preparing for the cold weather. Energy-efficient lighting or smart lighting helps reduce overall costs since your tenant will likely use electricity to keep warm. Ensure your outdoor lighting is rated for external use, as this can provide crucial illumination during longer nights. Draft guards on doors and windows help reduce the load on your rental’s HVAC system which can significantly improve its lifespan. This is also a great time to replace filters and clean the ductwork in your rental to improve energy efficiency. Additionally, consider installing an insulative film on older windows, which helps retain heat and keep rooms warmer without the need for extra heating. If your rental has a programmable thermostat, ensure it’s in working order, as this can help tenants manage an energy-efficient heating schedule more easily. Sign #3 Property Exterior Southern California is a great place to settle down, and while we don't need to worry about snowfall or deep freezes, ensuring the exterior of your rental property is ready for the cold weather is important. With our cold season mainly bringing with it rain, inspect your rental property’s rain gutter system . Remove debris from drains and check for leaks or signs of wear and tear. Walkways should be clear of debris and well-lit. This may require you to prune and trim trees and bushes that may leave behind leaves. When combined with rainfall, a single wet leaf can cause someone to slip and hurt themselves. Consider adding non-slip mats or tape to areas where people may have tripped in the past. Much like during the hotter weather, it's important for your rental to be ready for fall and winter. By keeping your property ready for any weather Southern California has to offer, you ensure your rental property and tenants will provide steady rental income every month. If you need help preparing your rental for the cold weather or if you need help managing Beach City rental property, we invite you to call us today at (562) 888-0247 or complete our Owner Application online .
By Dustin Edwards November 4, 2024
Owning a rental property in a beach city like Long Beach, CA , offers a number of advantages, like great weather and a strong real estate market. However, the cold ocean breezes can pose some challenges for landlords and tenants, making it convenient for property managers . Although the weather is generally great, these ocean breezes can sometimes make properties drafty and uncomfortable during the fall and winter seasons. Today we’ll go over four measures that can improve tenant comfort and protect your investment from the cold ocean breezes. Weatherproofing Againsts Drafts Drafts are caused by gaps between doors and windows which can make a rental feel colder than it is. This leads to unnecessary energy use and tenant discomfort. Sealing these gaps is not difficult and quite doable for a landlord who doesn’t mind getting their hands dirty. Replacing worn weatherstripping and adding fresh caulking to seal minor gaps blocks air from permeating the property. For additional protection from drafts, you can provide your tenant with inexpensive door sweeps. Improve Heating Efficiency Having efficient heating is crucial to countering the cooler ocean breezes while keeping costs low. Schedule regular maintenance for your HVAC system , such as replacing filters, cleaning vents, and cleaning the compressor to keep it running smoothly. This not only provides more efficient heating, it also extends the life of your HVAC system. Installing a smart thermostat is another way for tenants to adjust heating schedules efficiently. Protect Outdoor Spaces Outdoor areas such as patios, balconies, and even porches can oftentimes be exposed to the coastal breezes. This can be an issue in the long run, especially for rentals next to the beach , as the wind can carry sand and salt, which can accelerate the deterioration of metals, wood, and paint. This can be mitigated by adding windbreaks to the property, such as lattice panels or outdoor curtains, to create a more comfortable and functional outdoor space. Exterior finishes will require more frequent maintenance. This includes resealing wood and metal surfaces. As well as repainting is important to protect against wear from salt, sand, and moisture. Wind Mitigating Landscaping Much like with the curtains and lattice previously talked about, the landscaping can also be used as a windbreak. For example, planting wind-resistant shrubs or trees alongside exposed areas creates a natural barrier. This helps reduce the impact of the gusts of wind hitting the property. Many native plants thrive in coastal climates while also requiring minimal maintenance. While expensive, the results can greatly improve your rental’s longevity and curb appeal. Alternatively, you can strategically place planters to provide protection. Durable Furniture Furniture and fixtures exposed to the cold coastal breezes need to be able to withstand that wear and tear. Choose resilient materials such as treated wood, powder-coated metals, and outdoor-rated plastics. These are less prone to being damaged by the salt or wind. Furniture that is lightweight should be secured or anchored in place to prevent it from being blown away. By investing in durable furnishing, you can provide tenants with a comfortable and functional outdoor space for years to come. Protecting your beach city property from the cold ocean breeze doesn't necessarily require extensive renovations or investments. Try to focus on any relevant feedback from your tenant, this can help you pinpoint what part of your rental needs attention. If you need additional help protecting your rental property from the cold ocean breezes or if you need help managing Beach City rental property, we invite you to call us today at (562) 888-0247 or complete our Owner Application online .
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